Bucking the weak trend in stocks, the Indian rupee on Wednesday bounced back by 40 paise in its sharpest single-day gain in three weeks to end at 63.17 against the Greenback on fresh dollar selling by exporters and some banks.
Besides, talk of foreigners buying domestic debt also helped the local currency snap a two-session downward trend. The rupee commenced better at 63.51 a dollar from last close of 63.57. However, it fell back to the day’s low of 63.56 on some weakness in local equities amid strong dollar.
The rupee later rebounded sharply to a high of 63.15 on fresh dollar selling by exporters and some banks before settling at 63.17 — a smart rise of 40 paise or 0.63 per cent. This is its strongest gain since December 18 when it had appreciated by 50 paise.
In the previous two sessions, the rupee dropped by 28 paise or 0.44 per cent. Meanwhile, the equity benchmark Sensex, after crashing by 855 points or 3.07 per cent on Tuesday, declined further by 78.64 points or 0.29 per cent on Wednesday.
Foreigners sold shares worth Rs. 1,000 crore on Wednesday after offloading about Rs. 1,570 crore worth equities on Tuesday.
The dollar index was up by 0.20 per cent against its major global rivals ahead of the release of minutes of Fed’s last policy meeting.
According to Veracity Group CEO Pramit Brahmbhatt, the trading range for the spot rupee is expected to be within 62.80 to 63.50. Meanwhile, premia softened further on sustained receipts by exporters. The benchmark six-month premium payable in June eased to 21.5-223.5 paise from 222.5-224.5 paise on Tuesday.
Premium on forward contracts maturing in December also declined to 424-426 paise from 426.5-428.5 paise. The Reserve Bank of India fixed the reference rate for dollar at 63.4495 and for Euro at 75.2765.
The rupee shot up further to 95.53 against the pound from 96.57 previously. It recovered smartly to 74.76 per euro from 75.61.
Besides, the rupee also recouped to 53.02 per 100 Japanese yen from 53.40 on Tuesday.
